The Changing Face of Beauty Distribution

By: Ada Polla

At the panel discussion in 2010, beauty retailer representatives from various channels took the stage: Marla Malcolm Beck, founder and CEO, Bluemercury; Howard Kreitzman, vice president, cosmetics and fragrance, Bloomingdale’s; and Donna Tarantino-Loyle, director, health and beauty, ShopNBC. The panel’s insights highlighted some of the tensions between the industry’s various existing distribution channels.

Bluemercury is a beauty boutique and spa. Beck noted that in 2009, the Bluemercury team performed 100,000 spa treatments in the company’s 33 locations. Today, it has 38 locations, having taken over some former Douglas Cosmetics retail units, and it is further expanding. Beck spoke of the importance of training, as well as of the importance of sampling. She also spoke to accountability, saying ultimately she still picks every product that is on Bluemercury’s shelves.

Kreitzman spoke about his department store’s continued love of exclusivity, which he noted as a continued cornerstone of success. Pointing to Fekkai, he noted the fact that the brand’s decision to expand into the mass channel led Sephora to drop the line, highlighting that there is indeed some channel conflict and tension between the high-end department and specialty stores and the mass channel.

The department store channel, which some in the beauty industry see as a stale dinosaur, has been working on various initiatives to reinvent itself. To fight the growing crop of open-sell beauty retailers—ranging from Sephora to Ulta to CVS’s Beauty 360 and Duane Reade’s Look Boutiques—several department stores have begun testing, and seemingly expanding, their own open-sell concepts.

Kreitzman spoke about Bloomingdale’s working with Space NK to create an area for the sales of niche beauty brands not typically found in department stores. Other iterations of this idea include Macy’s Impulse Beauty Supply Stores and Dillard’s The Edge Shops. Muriel Gonzalez, executive vice president and general manager for cosmetics, fragrances and shoes, Macy’s, has commented, “Impulse Beauty is a beauty destination geared toward a trend-wise customer.